1. Stock A has a variance of .1428 while Stock B’s variance is .0910. The covariance of the returns for these two stocks is -.0206. What is the correlation coefficient?
A. -.1505 B. -.1146 C. -.1480 D. –.1643 E. –.1807
2. There is a positive relationship between changes in expected inflation and changes in the risk free rate.
True
False
3. The internal rate of return is the discount rate that forces the present value of a project's expected future cash flows to exactly equal the project's initial outlay.
True
False